The OECD Updated Its Model Tax Convention. Three Provisions That Change Your Transfer Pricing Analysis.
Distinguish the adopted 2025 OECD update from a later full-edition publication. Apply the actual treaty and domestic law before treating commentary as a tax event.
Editorial source review — November 1, 2026. This machine-generated article has been reviewed, but is not certified accurate. Source-backed corrections are incorporated where established. Other legal, survey and product claims may remain unverified; check applicable primary authorities before relying on a deadline or tax position.
Findings in the original version: the OECD update was adopted in November 2025; later publication of the full edition is different. A 50% work-time indicator is not a statutory automatic PE threshold.
The OECD adopted its 2025 Model Tax Convention update on November 18, 2025. Publication of a full model edition in September 2026 is a different event; it should not be described as a new universal domestic tax law.
Time spent at home is an indicator, not an automatic PE test
The commentary generally treats use of a home or other relevant place for less than 50% of total working time over the relevant twelve-month period as insufficient, by itself, to constitute a place of business of the enterprise. At or above 50%, a permanent establishment does not arise automatically: facts and circumstances, including a commercial reason for performing the enterprise's activities there, matter.
Do not turn the percentage into a stand-alone statutory exemption or assessment rule. Other permanent-establishment grounds and the actual treaty provisions still require analysis.
Check the applicable legal instrument
OECD model commentary does not itself amend every bilateral treaty or domestic law. Identify the treaty text, its dates and the relevant jurisdiction's interpretive approach before concluding that remote work creates a tax liability.
Operational recommendations
Maintain records of work locations, time periods, duties and the employer's business reasons. Escalate meaningful changes for tax review. These are suggested controls, not evidence that a new tax rate or deferred-tax adjustment automatically applies to every remote worker.